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U.S. Produce Packaging Demand to Approach $4.3 Billion in 2010

Sept. 21, 2006 - U.S. demand for produce packaging is forecast to increase 4.6 percent per year to $4.3 billion in 2010. Growth will be fueled by trends toward healthier eating and rising demand for fresh-cut, ready-to-eat produce, which offers convenience and tends to use more value-added packaging than bulk produce. Demographic trends such as the aging of the population, growth in the number of smaller households and working households will also favorably impact growth for fresh produce, including convenience-oriented products. These and other trends are presented in "Produce Packaging," a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.

Corrugated boxes will remain the leading produce packaging format. While box demand will increase at a slower than average pace, advances will be driven by the expanded prevalence of more costly box types such as modular boxes, white-top linerboard boxes and moisture-resistant boxes. Although continuing to benefit from significant usage by Wal-Mart, the largest U.S. grocery retailer, and rising use by retailers for specific applications, reusable plastic containers (RPCs) will still carry only a fraction of produce volume in the U.S.

Above-average prospects are anticipated for plastic containers, and bags and liners, aided by rapid advances for fresh-cut, ready-to-eat produce. Plastic container demand will be driven by expanding applications for clamshells beyond berries and grape tomatoes, and heightened demand for tubs, cups and bowls in ready-to-eat salads and cut fruit. Bag and liner demand will be aided by continued expansion in bagged salads, along with increased offerings of other ready-to-eat and ready-to-cook produce packaged in bags and pouches, such as precut broccoli, cauliflower and spinach, and single-serving pouches for sliced apples. The prevalence of value-added modified atmosphere packaging films for such bags will boost demand.

Salad, which accounted for 13 percent of produce packaging demand in 2005, will remain the fastest-growing segment of the market. Robust growth will be based on the growing popularity of entree salads in restaurants and healthy sales increases for bagged salads in retail channels. Solid prospects for retail single-serving salads and salad kits, which tend to use more costly packaging such as clamshells, will also fuel packaging gains. Fruit packaging applications will outpace vegetable uses, supported by robust growth for fresh-cut fruit and greater overall protective needs.

SOURCE: The Freedonia Group




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